Sunday, January 09, 2011

Banking on the government

Britain's best-paid banking boss, the Barclays chief executive Bob Diamond, will face intense pressure from MPs to waive his multimillion-pound bonus this week in recognition of the austere economic conditions and public intolerance of outsized City pay cheques.

An appearance by Diamond in front of the Treasury select committee on Tuesday is set to become a key clash between Westminster and the City as the coalition's efforts to tame bankers' pay falter.

Last night MP John Mann, a Labour member of the committee, said he and others would call on Diamond to forgo any bonus for 2010, when he was head of Barclays' investment banking arm.

"He will be asked not to take any bonus at all," said Mann. "We will want to know exactly how much these executives are getting in bonuses and other payments and why. There will be some tough questions."

So, here's what I think: MPs should shut the fuck up.

No, really.

Timmy deal with this whole affair in a rather more nuanced fashion, naturally, but the gist of the argument is this: Barclays was one of the few banks that did not go bankrupt in the crash; where they needed to shore up their capital, they found private investors willing to give them the loans. The simple fact is that Barclays took no taxpayer bail-out and, as such, it is none of our business—nor the government's—how the bank runs its business.

So, what the fuck do MPs think that they are doing in attempting to force the head of a private business to forego some of his renumeration? I mean, how fucking arrogant can you get?

In the meantime, the banks that the government does own are languishing in the realm of shit share prices and no dividends—perhaps our oh-so-wise MPs might turn their attention to the fact that those banks still aren't delivering any return for taxpayers, rather than sticking their fat, alcohol-bloated noses into affairs that simply don't concern them.

So, my suggestion to Bob Diamond is that he tells the Treasury select committee to go fuck itself.

22 comments:

I can see where you're coming from, and I hate to see politicians interfering in private businesses, but I think it's fair to say that Barclay's benefited indirectly from the government bailouts. Their exposure to the bad debts of other banks was reduced when responsibility for these debts was foisted on the taxpayer.

It's also the case that, along with all the other banks, they benefit from the policies of the Bank of England. The Cobden Centre has many articles on this subject.

The banking industry isn't really in the private sector. All the furore over bonuses is a distraction. We need wholesale reform.

And all failed MPs and un-civil servants will of course forego all their pay, pensions, expenses and golden hand shakes......No, thought not! As an ex engineer, ragbolts, red hot and rape spring to mind.

Point out the bank bailout for the northern banks that have failed has cost 27 billion. About a month and a half of government overspend. Also point out the 55 billion a year of tax the government takes for no risk.

Then we have the crap about a 100 billion a year subsidy because banks are borrowing low, lending high. Since the mortgage market is a trillion, that would imply borrowing costs of more than 10%, with a zero percent for savers. In other words its a made up figure

It's all part of nulav's (and the beeb's) continuing campaign to distract the electorate's attention from the fact that the primary cause of the financial ruin in the UK was gordon brown's reorganisation of the fsa.

This meant that regulation of the banks failed and banks were not held in check.

Of course the proper "solution" to the post-crisis financial system is far too difficult for the government to explain or at least the government thinks it is because it thinks we are all too stupid to understand.

Barclays very carefully sought funding privately so as to avoid being caught up in the mess of nationalisation. Therefore I agree with you that Parliament should just fuck off.

I find it vaguely amusing that little people still fret over how many millions bankers award themselves in bonuses - it wasn't that long ago that Barclay's found itself in a spot of bother that required a bail out from the bank of Englandhttp://news.bbc.co.uk/1/hi/business/6971731.stm

Despite this little wobble I'm sure the Barclay's boardroom remunerated itself sufficiently come the bonus season - after all, this lot have form when it comes to patting themselves on the back? http://www.guardian.co.uk/business/2010/apr/03/barclays-defends-diamond-mandelson-attack

After reading this headline I found myself thinking of the old L'oreal adshttp://www.youtube.com/watch?v=84SUfl8Yv4k

But instead of a model shaking her hair (in slo-mo) imagine an Eric Pickles 'look a like' mouthing into the mirror "because you are worth it"http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2010/6/2/1275474451180/Eric-Pickles-003.jpg

Judging by the amount of dosh awarded to themselves (£7 billion according to the Fail) I can only assume the bankers have come up with a cure for cancer, not to mention an exciting new formula for world peace?http://www.dailymail.co.uk/news/article-1345961/Ministers-cave-7bn-bonuses-bankers.html

The fact they run the most efficient financial institutions on the planet is a given?

I'm not surprised that commentators weep at the prospect of the worthy bankers being deprived of the finest Russian hookers and regular portions of beluga caviar washed down with finest shampoo!!

@Suboptimal Planet - absolutely agree but I had the 1 and only stand-up argument with my boss about inflation because I was shitting myself that the time lag would be much less. As it is, most budget holders have had time to prepare.

Whilst Bernanke's figures are nice it's certainly not the whole picture. It does, from the BoE's perspective, who have been relatively prudent in comparison to the FED, seem that QE did a job and it's become an intellectual exercise to discern what, when & how rather than picking a big pile of steaming shit and living in a viscious cycle in a lose lose framework.

Fuck it, i'll give 'em 7 out of 10 (maybe even 7.5) - fucking job nicely fucking done. It's gonna take decades to plug the hole into something like our previous assumptions would acknowledge as preferrable but, for the time being, bought a few more months. Good shot.

Absolutely disgraceful reporting from the BBC, in which they smear Bob Diamond by association and don't bother to mention that Barclays was not bailed out (the TV version of this report on the BBC News at 10 was even worse): http://www.bbc.co.uk/news/business-12162915

"Absolutely disgraceful reporting from the BBC, in which they smear Bob Diamond by association and don't bother to mention that Barclays was not bailed out" - I'm surprised the fabulously wealthy bankers decided against legal action if the Beeb told porkies?

Hang on a minute. All banks are a state sanctioned cartel with special priviledges. The priviliges are , one they are the only businesses on the planet who have state sanction to renege on their liabilities. And two, they are allowed to make money.

"At least they get their Guardian Drivel Code Words in at the top of the page"

The articles there are mixed, but broadly libertarian.

You don't have to be a Guardianista to want honest money and social progress. Honest money is about making it difficult for the government to rob us through currency debasement, and 'progress' is desired by anyone who isn't a reactionary sociopath.

Socialists enjoy perverting words like 'fairness' and 'progress', but I don't see why we should cede these terms.

Whether you care about your fellow man or not, millions of British people do, and the only way we'll ever achieve a libertarian society is by convincing the masses that socialism can't deliver true fairness and prosperity.

I don't know what your angle is, but most libertarians understand the difference between being pro-market and pro-business. If you believe in genuine capitalism, you should be aghast at our socialist banking system.